French govt mulling corporate tax cut - paper

PARIS, Sept 5 France's Socialist government is
considering cutting the corporate tax rate to 30 percent from 33
percent as part of a broad overhaul, business newspaper Les
Echos reported on Thursday.

Facing a growing revolt from businesses over taxes that are
among the highest in Europe, the government acknowledged last
week that it could not add to companies' tax burden without
putting jobs at risk.

Citing sources representing employers, Les Echos reported
that a final decision had not yet been taken, but the government
was looking at modifying the tax bases used for determining what
a company owes.

In particular, the government is considering taxing
companies based on their gross operating earnings rather than
the current practice of using their sales, which is unpopular
with many firms.

President Francois Hollande's Socialist government is
currently drafting its 2014 budget bill, which is due to be
presented at the end of the month.

It had originally planned to raise an additional 6 billion
euros in new taxes next year. However, it acknowledged last
month that taxpayers were reaching their limits and said it
would scale down plans for a new round of tax hikes next year.

At 44.2 percent of GDP, the French tax burden ranks behind
only Denmark and Sweden among the 34 members of the Organisation
for Economic Co-operation and Development.

The government is seeing a growing backlash from voters and
businesses after it imposed 30 billion euros in hikes this year,
seeking to honour a promise to its EU partners to bring its
budget deficit below the bloc's target ceiling next year.

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